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Fos time limit rules face criticism

The Financial Ombudsman Service has been criticised for the use of its time limits to prevent some complaints from going ahead.

An adviser acting on behalf of two clients who took a complaint to the Fos said he was “bemused” by the apparent inconsistency.

Philip Milton said claims against payment protection insurance from the 1990s were still being ruled on but his client’s mortgage case from 2006 was judged to have taken place too long ago.

Fos rules mean it will “generally” only consider complaints submitted six years from the event the consumer is complaining about or – if later – three years from when the consumer knew, or could reasonably have known they had cause to complain.

The complaint Mr Milton was handling was rejected because it failed both these requirements.

But he said: “I am bemused. Most of the PPI claims, let alone pension review claims which the ombudsman has adjudged would have taken place many years before the six-year limit suggested as sacrosanct now.

“A mortgage could be sold today and only after 25 years, in theory, be found to have been negligent advice and the mortgage adviser cannot be let-off scot-free after just six years.”

Several of the most recent PPI rulings on the Fos website relate to policies bought in 2000 or 1999, with one dating back to 1993.

Mr Milton's clients, who are a couple, had complained about mortgage advice they were given in 2006 and an adjudicator told them they should have been aware they had cause to complain in 2011 when the completion of the investment property was uncertain.

The adjudicator said: “As the property was the repayment vehicle for the mortgage I feel that you ought to have become concerned at this date as to how the mortgage was going to repaid, and whether you had been sold a suitable mortgage product.”

She ruled that the complaint therefore fell outside the Fos time limit.

A spokesman for the Fos said: “In general we will only consider a complaint if it is brought to us within six months of a business sending its final response to the complaint.

“It also needs to be brought to us within six years of the event being complained about, or within three years of when the reason to complain was realised or could reasonably have been realised.

“If these time limits have passed, then we can’t look at the complaint unless the business consents.

“However, if there have been exceptional circumstances that would have prevented someone from complaining, then we will be able to look at a complaint.”